Canada Cheers Trade Panel Decision on U.S. Softwood Lumber Policy Review
Canada celebrated a trade dispute panel’s recent ruling, urging the United States to reevaluate aspects of its softwood lumber policy, which included tariffs on most timber products exported from Canada.
The ongoing dispute dates back to a decades-long clash over the structure of Canada’s timber sector, remaining unresolved since the expiration of a quota agreement in 2015. American producers argue that Canada unfairly subsidizes its lumber industry.
The U.S. imposed tariffs based on the assertion that Canadian timber, harvested from federal and provincial lands with government-set low stumpage fees, amounts to an unfair subsidy. In contrast, the majority of American timber is harvested from private lands at market rates.
The recent ruling, issued on Thursday, directs the U.S. to reevaluate its treatment of export taxes. Back in July, the U.S. Commerce Department had established a duty rate of 7.99% on these products.
Trade Minister Mary Ng expressed Canada’s contentment with the North American Free Trade Agreement (NAFTA) dispute panel’s agreement that certain elements of the U.S. dumping determination contravene U.S. law.
It’s important to note that NAFTA was replaced by the United States-Mexico-Canada Agreement (USMCA) in 2020.
The U.S. Commerce Department had not responded to Reuters’ request for comment at the time of reporting.